EXHIBIT 10(b)
STANHOME INC.
1991 Stock Option Plan, as amended
Through March 1, 1995
1. Purpose. The purpose of this 1991 Stock Option Plan (the "Plan")
is to advance the interests of Stanhome Inc. (the "Company") by encouraging
key management employees of the Company and its subsidiaries and non-
employee directors of the Company to acquire a proprietary interest in the
Company through ownership of common stock of the Company. Such ownership
will encourage the optionees to remain with the Company and will help
attract other qualified persons to become employees and directors.
2. Administration. The Plan shall be administered by the
Compensation and Stock Option Committee of the Board of Directors (the
"Committee") which shall be composed of not less than three directors of
the Company elected or to be elected as members of the Committee from time
to time by the Board of Directors of the Company. None of the Committee
members shall be, during service on the Committee, nor shall have been,
during the one year prior to service on the Committee, granted or awarded
Shares or options to acquire Shares under this Plan or any other plan
maintained by Stanhome or any of Stanhome's affiliates, other than any
grant or award of options or other equity securities of Stanhome pursuant
to Section 9 of the Stanhome Inc. 1991 Stock Option Plan or any other plan
of Stanhome that would not result in such Committee member failing to
qualify as a 'disinterested person' under Rule 16b-3 of the Securities
Exchange Act of 1934, as amended, as in force from time to time. Members
of the Committee shall be subject to any additional restrictions necessary
to satisfy the requirements for disinterested administration under Rule 16b-
3 of the Securities Exchange Act of 1934, as amended, as in force from time
to time. Subject to the provisions of the Plan and the approval of the
Board of Directors of the Company, except that the Board of Directors shall
have no discretion with respect to the selection of officers within the
meaning of Rule 16a-1(f), directors or 10% or more shareholders
("Insiders") for participation and decisions concerning the timing, pricing
and amount of a grant or award to such "Insiders", the Committee is
authorized to grant options under the plan and to interpret the Plan and
such options, to prescribe, amend and rescind rules and regulations
relating to the Plan and the options, and to make other determinations
necessary or advisable for the administration of the Plan, all of which
determinations shall be conclusive. The Committee shall act pursuant to a
majority vote or by unanimous written consent.
3. Types of Options. Options granted pursuant to the Plan may be
either incentive stock options under Section 422 of the Internal Revenue
Code of 1986, as amended, ("Incentive Stock Options") or options not
qualifying under that section of the Code ("Non-qualified Stock Options").
It is the intent of the Company that Non-qualified Stock Options granted
under the Plan not be classified as Incentive Stock Options, that the
Incentive Stock Options granted under the Plan be consistent with and
contain or be deemed to contain all provisions required under Section 422
and the other appropriate provisions of the Code and any implementing
regulations (and any successor provisions thereof), and that any
ambiguities in construction shall be interpreted in order to effectuate
such intent.
4. Eligibility. Options shall be granted under the Plan to such
selected key full-time salaried and commissioned employees (including
officers and directors if they are employees) of the Company or any of its
subsidiaries as the Committee shall determine from time to time. Options
shall also be granted under the Plan to the non-employee directors of the
Company (the "Non-employee Directors") pursuant to Section 9 hereof.
5. Stock Subject to Options. The aggregate number of shares which
may be issued or sold under options granted pursuant to the Plan (the
"Shares") shall not exceed 2,000,000 shares of the Company's common stock
$0.125 par value each. Such Shares shall be either authorized but unissued
shares of said common stock or issued shares of said common stock which
shall have been reacquired by the Company. Such aggregate number of Shares
may be adjusted under Sections 9 and 10 below. If any outstanding option
under the Plan expires or is terminated for any reason, the Shares
allocated to the unexercised portion of such option may again be subjected
to an option or options under the Plan.
6. Allotment of Shares. Except as provided under Section 9 hereof,
the Committee shall determine the total number of Shares to be offered to
each optionee under the Plan.
7. Option Price. The Shares shall be offered from time to time
under the Plan at a price which shall be not less than the greater of (i)
100 percent of the Fair Market Value of the Company's common stock on the
date the option is granted, or (ii) the par value of the Company's common
stock subject to the option; provided, however, that the price shall be not
less than 110 percent of such Fair Market Value in the case of shares
offered under any Incentive Stock Option granted to an individual who, at
the time the option is granted, owns stock possessing more than 10 percent
of the total combined voting power of all classes of stock of the Company
or of its subsidiaries.
8. Terms and Conditions of Options. The Committee shall have power,
subject to the limitations contained in the Plan, to prescribe the terms
and conditions of any option granted hereunder. Each such option shall be
evidenced by a certificate in such form as the Committee shall from time to
time determine, which certificate shall prescribe the following terms and
conditions and such other terms and conditions as the Committee may deem
necessary or advisable:
(a) Duration of Options. Except as hereinafter otherwise provided,
options granted under the Plan shall be exercisable for such period of time
as the Committee shall determine. An Incentive Stock Option shall not be
exercisable after the expiration of ten years from the date it is granted;
provided, however, that any Incentive Stock Option granted to an individual
who, at the time the option is granted, owns stock possessing more than 10
percent of the total combined voting power of all classes of stock of the
Company or of its subsidiaries shall by its terms not be exercisable after
the expiration of five years from the date of grant.
(b) Exercise of Options. Except as hereinafter otherwise provided,
each option granted under the Plan may be exercised only after one year of
continued employment by the Company or one of its subsidiaries immediately
following the date the option is granted and only during the continuance of
the optionee's employment with the Company or one of its subsidiaries and
such additional period as may be provided in subsection (e) below. No
option shall be exercised for less than 10 Shares except as a result of an
adjustment under Sections 9 or 10 below.
(c) Payment. The purchase price of each Share purchased upon the
exercise of any option granted hereunder shall be paid in full at the time
of such purchase, and a stock certificate representing Shares so purchased
shall be delivered to the person entitled thereto. Until the stock
certificate for such Shares is issued in the optionee's name, he or she
shall have none of the rights of a stockholder. Payment may be made in
whole or in part in (i) cash or (ii) whole shares of the Company's common
stock acquired at least six months previously by the optionee and evidenced
by negotiable certificates, valued at their Fair Market Value on the date
preceding the date the option is exercised. If certificates representing
shares of common stock are used to pay all or part of the purchase price of
an option, separate certificates shall be delivered by the Company
representing the same number of shares as each certificate so used and an
additional certificate shall be delivered representing the additional
shares to which the option holder is entitled as a result of exercise of
the option. It shall be a condition to the performance of the Company's
obligation to issue or transfer Shares upon exercise of an option or
options that the optionee pay, or make provision satisfactory to the
Company for the payment of, any taxes (other than stock transfer taxes)
which the Company is obligated to collect with respect to the issue or
transfer upon such exercise. With respect to the exercise of Non-qualified
Stock Options granted pursuant to this Section 8, optionees may elect to
have the Company withhold a designated number of Shares otherwise issuable
upon the exercise of such stock options, or, in the case of "Insider"
optionees, to commit irrevocably at a time acceptable under the provisions
of Section 16 of the Securities Exchange Act of 1934, as amended, to
surrender to the Company shares of common stock to cover Federal and State
tax obligations incident to such exercise, or such other maximum amounts as
may be determined by the Committee.
(d) Nontransferability of Options. No option shall be transferable
by the optionee otherwise than (1) by will or the laws of descent and
distribution or (2) pursuant to a qualified domestic relations order as
defined in Section 414(p) of the Internal Revenue Code of 1986, as amended,
and each option shall be exercisable, during his or her lifetime, only by
the optionee or his or her guardian or legal representative(s), except to
the extent that options granted hereunder are assigned pursuant to a
qualified domestic relations order.
(e) Termination of Options. If the optionee's full-time employment
by the Company or any of its subsidiaries shall terminate for any reason
other than death, his or her options shall terminate immediately upon such
termination of employment, if not sooner terminated pursuant to their
terms, except that, subject to subsection (a) above, any such options shall
be exercisable during the three year period following any such termination
of employment by the optionee or his or her guardian or legal
representative(s) only as to the number of Shares which the optionee was
entitled to purchase on the day preceding such termination, except further
that in the case of Incentive Stock Options the period for such exercise
following such termination shall be limited to three months, or, in the
case of a termination of employment by reason of disability, to twelve
months. If the optionee's full-time employment by the Company or any of
its subsidiaries shall terminate by reason of death, his or her options
shall terminate immediately upon such termination of employment, if not
sooner terminated pursuant to their terms, except that, subject to
subsection (a) above, any such options shall be exercisable, as of the time
of such optionee's death, to the extent such options were granted to such
optionee on or prior to the date which is one year prior to the date of
such optionee's death and any such options shall be exercisable during the
two year period following any such termination of employment by the
optionee's legal representative(s). Cessation of any corporation's
relationship with the Company as a subsidiary shall constitute a "termin
ation of employment" hereunder as to individuals employed by that
corporation, and options held by such individuals shall be terminated in
accordance with this subsection. For purposes of this subsection, the
meaning of the word "disability" shall be determined under the provisions
of Section 422(c)(7) of the Internal Revenue Code of 1986, as amended, or
any successor provisions thereof.
(f) Fair Market Value. For purposes of this Plan, "Fair Market
Value" shall be the applicable day's closing sales price of the Company's
common stock as reflected on the consolidated tape of the principal
exchange on which such stock is traded, or, if there are no sales on such
date, such price on the most recent trading day prior thereto.
9. Non-employee Directors' Options. The Committee shall not have
any discretion with respect to the options granted to the Non-employee
Directors under the provisions of this Section 9. Except as hereinafter
otherwise provided, options granted pursuant to this Section 9 shall be
subject to the terms and conditions set forth in Section 8.
(a) Grant of Options. On the day following each of the 1991 through
and including the 1995 annual stockholders' meetings, each Non-employee
Director on that date shall automatically be granted an option to purchase
1,500 Shares. The maximum number of Shares for which options may be
granted to any Non-employee Director under the Plan shall be 7,500. All
such options shall be Non-qualified Stock Options. The price at which each
Share covered by such options shall be purchased shall be the greater of
(i) 100 percent of the Fair Market Value of the Company's common stock on
the date the option is granted, or (ii) the par value of the Company's
common stock subject to the option.
(b) Exercise of Options. Twenty-five percent of the total number of
the Shares subject to an option granted to the Non-employee Director shall
become exercisable on the later of (i) the next February 1 following the
date on which the option was granted or (ii) six months after the date on
which the option was granted and twenty-five percent on February 1 of each
of the next three consecutive calendar years. The right to purchase Shares
with respect to an option which has become exercisable shall be cumulative
during the term of the option. The option may be exercised by the Non-
employee Director or his or her guardian or legal representative(s) during
the period that the Non-employee Director remains a member of the Board of
Directors and for a period of three years thereafter, or a period of two
years thereafter in the case of the Non-employee Director's death while
serving as a member of the Board of Directors, provided that only those
options exercisable on the day preceding the date the Non-employee Director
ceases to be a member of the Board of Directors may be exercised during
said applicable period and, provided further, that in no event shall the
option be exercisable more than ten years after the date of grant. All
options that are not exercisable on the day preceding the date the Non-
employee Director ceases to be a member of the Board of Directors shall be
immediately terminated.
(c) Payment. An option granted to the Non-employee Director shall
be exercisable only upon payment to the Company in accordance with the
provisions of Section 8(c) of the full purchase price of the Shares with
respect to which the option is being exercised.
(d) Adjustment of Options. In the event of a stock dividend, split-
up or combination of shares, recapitalization, reclassification or merger
in which the Company is the surviving corporation, or other similar capital
or corporate structure change, the number of Shares at the time of such
change remaining subject to any option granted or to be granted pursuant to
the provisions of this Section 9 shall be increased or decreased, as the
case may be, in direct proportion to the increase or decrease in the number
of shares of common stock of the Company by reason of such change in
corporate structure, provided that the number of Shares shall always be a
whole number with any fractional Shares being deleted therefrom, and the
purchase price per Share of any outstanding options shall, in the case of
an increase in the number of Shares, be proportionately decreased, and in
the case of a decrease in the number of Shares, be proportionately
increased. In the event of a consolidation or merger in which the Company
is not the surviving corporation or of a "Change in Control" as defined in
Section 10, including, but not limited to, "Changes in Control" in which
the Company is the surviving corporation, and notwithstanding the preceding
sentence, each option outstanding under the provisions of this Section 9
shall thereupon terminate, provided that within ten days of the effective
date of any such consolidation, merger, or "Change in Control", the Company
shall pay in cash the difference between the exercise price of the
unpurchased Shares under the options and the value of consideration
receivable in the transaction by a holder of the number of shares of common
stock equal to the number subject to the options.
10. Changes in Stock. In the event of a stock dividend, split-up or
combination of shares, recapitalization, reclassification or merger in
which the Company is the surviving corporation, or other similar capital or
corporate structure change, the number and kind of Shares at the time of
such change remaining subject to the Plan and to any option granted or to
be granted pursuant to the Plan, except for options granted or to be
granted pursuant to Section 9, the option price and any other relevant
provisions shall be appropriately adjusted by the Board of Directors of the
Company, whose determination shall be binding on all persons. In the event
of a consolidation or merger in which the Company is not the surviving
corporation, (i) each option outstanding hereunder that is held by an
"Insider" optionee and that is not outstanding under the provisions of
Section 9 shall become immediately exercisable and (ii) each option
outstanding hereunder that is held by an optionee who is not an "Insider"
shall terminate, provided that at least twenty days prior to the effective
date of any such consolidation or merger, the Board of Directors of the
Company shall do one of the following with respect to options held by
optionees who are not "Insiders": (1) make such options immediately
exercisable, (2) arrange to have the surviving or consolidated corporation
grant replacement options to the optionees involved, or (3) pay in cash the
difference between the exercise price of the unpurchased Shares under the
options and the value of consideration receivable in the transaction by a
holder of the number of shares of common stock equal to the number subject
to the options. No adjustment provided for in this Section 10 shall
require the Company to issue or sell a fractional share under any option
hereunder and any fractional share resulting from any such adjustment shall
be deleted from the option involved.
Notwithstanding anything herein to the contrary, in the event of a
"Change in Control" as defined below, including certain consolidation or
merger events otherwise giving rise to the adjustments or alternatives
described in the above paragraph, each option outstanding under this Plan
shall thereupon terminate, provided that within ten days of the effective
date of such Change in Control, the Company shall pay in cash the
difference between the exercise price of the unpurchased Shares under the
options and the value of consideration receivable in the transaction by a
holder of the number of shares of common stock equal to the number subject
to the options. As used herein, "Change in Control" means a Change in
Control of a nature that would, in the opinion of the Company counsel, be
required to be reported in response to Item 6(e) of Schedule 14A of
Regulation 14A promulgated under the Securities Exchange Act of 1934, as
amended ("Exchange Act"); provided that, without limitation, such a Change
in Control shall be deemed to have occurred if: (i) any "Person" (as such
term is used in Sections 13(d) and 14(d) of the Exchange Act (other than
the Company or any subsidiary of the Company, any trustee or fiduciary
holding securities under an employee benefit plan of the Company or any of
its subsidiaries or a corporation owned, directly or indirectly, by the
stockholders of the Company in substantially the same proportions as their
ownership of the stock of the Company)) becomes the "beneficial owner" (as
defined in Rule 13d-3 of the Exchange Act), directly or indirectly, of
securities of the Company representing 25% or more of the combined voting
power of the Company's then outstanding securities; or (ii) during any
period of two consecutive years (not including any period prior to the
effective date of this Plan), individuals who at the beginning of such
period constitute the Board of Directors and any new director (other than a
director designated by a Person who has entered into an agreement with the
Company to effect a transaction described in clause (i), (iii), or (iv) of
this paragraph) whose election by the Board of Directors or nomination for
election by the Company's stockholders was approved by a vote of at least
two-thirds (2/3) of the directors then still in office who either were
directors at the beginning of the period or whose election or nomination
for election was previously so approved cease for any reason to constitute
a majority thereof; or (iii) the stockholders of the Company approve a
merger or consolidation of the Company with any other corporation, other
than (A) a merger or consolidation which would result in the voting
securities of the Company outstanding immediately prior thereto continuing
to represent (either by remaining outstanding or by being converted into
voting securities of the surviving entity), in combination with the
ownership of any trustee or other fiduciary holding securities under an
employee benefit plan of the Company, at least 75% of the combined voting
power of the voting securities of the Company or such surviving entity
outstanding immediately after such merger or consolidation, or (B) a merger
or consolidation effected to implement a recapitalization of the Company
(or similar transaction) in which no Person acquires 25% or more of the
combined voting power of the Company's then outstanding securities; or (iv)
the stockholders of the Company approve a plan of complete liquidation of
the Company or an agreement for the sale or disposition by the Company of
all or substantially all the Company's assets.
With respect to all optionees other than the Non-employee Directors,
no Change in Control shall be deemed to have occurred if the optionee is a
member of a management group which first announces a proposal which
constitutes a Potential Change in Control, unless otherwise determined by a
majority of the members of the Board of Directors who are not members of
such management group. A "Potential Change in Control" shall be deemed to
have occurred if the conditions set forth in any one of the following
subsections shall have been satisfied: (i) the Company enters into an
agreement, the consummation of which would result in the occurrence of a
Change in Control; (ii) the Company or any Person publicly announces an
intention to take or to consider taking actions, which if consummated,
would constitute a Change in Control; (iii) any Person who is or becomes
the beneficial owner, directly or indirectly, of securities of the Company
representing 10% or more of the combined voting power of the Company's then
outstanding securities, increases such Person's beneficial ownership of
such securities by 5% or more over the percentage so owned by such Person
on the date hereof; or (iv) the Board of Directors adopts a resolution to
the effect that, for purposes of this Plan, a Potential Change in Control
has occurred.
11. Effective Date; Stockholder Approval; Term. The Plan was
adopted by the Board of Directors on January 23, 1991 and shall become
effective on April 25, 1991 if the Plan is approved by the holders of a
majority of the common stock outstanding and entitled to vote at the Annual
Meeting of Stockholders scheduled for April 25, 1991. No option hereunder
shall be granted after January 23, 2001 or the earlier suspension or
termination of the Plan in accordance with its terms. The Plan shall
terminate on January 23, 2001 or on such earlier date as it may be
suspended or terminated under the provisions of Section 12 below or as of
which all Shares subject to options authorized to be granted under the Plan
shall have been acquired by exercise of such options.
12. Amendment or Discontinuance of the Plan. The Board of Directors
of the Company may, insofar as permitted by law, at any time or from time
to time, suspend or terminate the Plan or revise or amend it in any respect
whatsoever except that, without appropriate approval of the stockholders of
the common stock, no such revision or amendment shall increase the maximum
number of Shares subject to the Plan, change the designation of the class
of employees eligible to receive options, decrease the price at which
options may be granted or otherwise change the provisions of this Plan to
the extent approval of the holders of the common stock of the Company is
required under applicable securities laws. Notwithstanding the preceding
sentence, amendments to change the provisions of Section 9(a) shall not be
made more frequently than once every six months other than to comply with
the Internal Revenue Code or the Employee Retirement Income Security Act.
13. Applicable Laws or Regulations and Notification of Disposition.
The Company's obligation to sell and deliver Shares under an option is
subject to such compliance as the Company deems necessary or advisable with
federal and state laws, rules and regulations applying to the
authorization, issuance, listing or sale of securities. The Company may
also require in connection with any exercise of an Incentive Stock Option
that the optionee agree to notify the Company when making any disposition
of the Shares, whether by sale, gift, or otherwise, within two years of the
date of grant or within one year of the date of exercise.
14. No Employment Right; No Obligation to Exercise Option. Nothing
contained in the Plan, or in any option granted under it, shall confer upon
any optionee any right to continued employment by the Company or any of its
subsidiaries or to continued membership on the Board of Directors of the
Company or limit in any way the right of the Company or any subsidiary to
terminate the optionee's employment at any time. The granting of any
option hereunder shall impose no obligation upon the optionee to exercise
such option.